Financing the real economy: this is the mantra that pushed the public authorities to introduce unlisted assets into the French people’s preferred envelope. Since October 24, under the application of the green industry law, life insurance contracts and retirement savings plans (PER) must offer savers under managed management a minimum share of unlisted assets, whether it is private equity or private debt. Corporate PERs have a deadline, until June 30, 2026, to comply with this new obligation. The measure only concerns new subscriptions but insurers can integrate it into the old PERs to enrich their offer. Holder of an individual contract, however, do not be surprised if your intermediary does not offer it to you immediately: due to the late publication of the decrees but also the reluctance of certain insurers, all contracts are far from ready. .
Another explanation: the scarcity of eligible products. In fact, insurers favor open funds (known as evergreen), with a single call for funds, which can be subscribed to permanently and also allow you to withdraw your savings at regular intervals. They were able to shop among the few existing funds, already listed in life insurance, such as NextStage Croissance (NextStage AM), Apeo (Seven2), Eiffel Infrastructures Vertes (Eiffel IG) and Eurazeo Private Value. Europe 3 (Eurazeo). Created in 2018 with a strategy consisting of investing 60% in private debt and 40% in private equity, the latter has generated more than 38% performance over the last five years. This has earned it some success since it has more than 2 billion euros in assets. Another “historic” product, the Eiffel IG fund, invests 100% on infrastructure debt. “Private debt lends itself well to the unit-of-account format of life insurance because it is a medium of return, estimates Laura Carrere, deputy general director of Eiffel IG. In addition, we invest in short-term debt – between two and four years – which provides fairly strong intrinsic liquidity to the fund.”
Limit unwanted back and forths
An attractive point for insurers who must allow their subscribers to make withdrawals from their contract whenever they wish. To limit untimely return trips, the latter have also obtained the possibility of implementing an exit penalty of up to 5% of the amount withdrawn before a minimum period (often eight years), or even 20% in the event of of crisis. Private debt is also attractive due to its lower level of risk than private equity. MACSF has already been offering such a product to its clients since 2021. It has renewed the experience with a new account unit managed by Andera Partners. “The fund finances business leaders wishing to regain control of their company,” explains Roger Caniard, financial director of the mutual.
Other players, firmly established in the ecosystem, have lined up for the occasion, such as Sienna IM or Edmond de Rothschild Private Equity. There are many fund launches, but the big unknown is whether savers will follow. “It’s a promising market but there remains a lot of uncertainty,” recognizes Laura Carrere. In particular, certain insurers may choose to reference a fund, in order to comply with their obligations, without promoting it. “In the long term, success will depend on our ability to deliver performance,” believes the professional. In this area, past performances are hardly conclusive. According to the specialized site Good Value for Money, the 40 risk mutual funds (FCPR) referenced in life insurance, which are invested in the securities of companies not listed on the stock exchange at a minimum of 50%, delivered an average performance annual rate of 3.67% over the last seven years. A modest figure which must however be analyzed with caution as the sample covers distinct strategies. Furthermore, it is likely – and desirable – that current competition will push fund managers up.